The Spectator

Britain’s jobs miracle proves there is no reason to fear technology

Another week, another set of economic figures that suggest the country is showing remarkable resilience while politics implodes. Rather than fall into recession, as so many predicted, the economy leapt forward in July. We now have the lowest unemployment for 45 years, an extraordinary figure. Income inequality is near a 30-year low. The confidence crisis that politicians are experiencing is not reflected outside of Westminster.

There is little evidence to suggest that machines are taking people’s jobs. Instead, they are being used to do low-end tasks, freeing up humans to work in more complex, better-paid roles. We now have machines taking restaurant orders, checking people in at airports and fulfilling other functions inside various businesses. But never has the economy needed more people to be in work. Wages are growing at the fastest rate in 11 years. The proportion of workers employed on zero-hours contracts — a hated concept among many in the Labour party — is at 2.7 per cent. These jobs are widely confined to those who seek such contracts, preferring the flexibility they offer.

The dystopian vision of a future in which technology drives mass unemployment might be no more than a fantasy. As workers are shed by one industry, in a functioning economy they are rapidly taken up by others. While some professions have or are on the point of disappearing altogether, others come into being. Moreover, the professions that are being created tend to be more highly skilled than those that are disappearing: telephonists are replaced by software engineers, clerks by systems analysts.

True, the easy availability of low-skilled labour from eastern Europe after former Soviet bloc countries joined the EU in 2004 seems to have stalled some investment in automation. But this is already beginning to look like a passing phase, as employers who relied too much on imported labour struggle to maintain their business models as a weak pound makes inward migration less attractive.

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